Innovator of the Year Finalist Customer Maturity Index

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1 Innovator of the Year Finalist Customer Maturity Index Boaz Maor VP Customer Success OpenGov platinum sponsor

2 Your Customer Health Score may be quite useless Comments and feedback are very welcome Please tweet with: #CS100Summit #CustomerMaturity Ralf Wittgen - Chief Customer Officer Promapp Solutions, Auckland Boaz S. Maor VP Customer Success OpenGov, Redwood City,

3 A Kiwi and an Israeli walk into a café in Silicon Valley

4 The customer is the most important part of our business. They are not dependent on us; We are dependent on them. They are not an interruption in our work; They are the purpose of it. Source:

5 Customer Health Score (CHS) 1. Identify Challenges and Opportunities 2. Determine an Action Plan 3. Forecast Expected Outcomes

6 1. Stage 2. Size 3. Location 4. Industry 5. Use Case

7 But, even with segmentation, Your Customer Health Score may be quite useless

8 Large enterprises (Size) West-Coast based (Location) Relations for multiple years (Stage) Very high usage Strong relationships Repeat expansion High CSAT

9 Customer A A single office A single business Grew organically A very strong team of highly professional people Customer B Multiple offices nationwide Three very different businesses Grew by acquisitions Team had varying degrees of technology understanding Focus with us on features, service levels and execution Focused their energy on consolidating their businesses

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11 MATURITY MODELS

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13 Customer requires a lot of consulting to help business Software use is basic, sporadic Software fees are low Need for services diminishes Software usage is high Pressure for advanced features Vendor can increase software fees Revenue Services Revenue Software Revenue Immature Low Medium High Maturity Customer requires lots of consulting Software use is basic and minimal Gross margin is low, CAC Ratio too long Conclusion: Do not sell or serve (unqual) Need for consulting declines Need for training on software increases Use of advanced features increases Software fees can be increased

14 Customer Health Score measures the relations between the vendor and the customer. It is aimed at assessing the health of those relations and predicting their future direction: churn, renewal, expansion. Customer Maturity Index measures the sophistication of the customer in running their function and consequently their ability to utilize and derive value from the vendor s solution. It is aimed at identifying the actions the vendor should take to address the customer needs.

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16 A Suggested Customer Maturity Framework

17 A Suggested Customer Maturity Framework (Detail)

18 A Suggested Customer Maturity Framework (example) Low

19 Customer Health Score A Suggested Customer Maturity Framework (Implications) High Retain Expand and Leverage Low Churn or Let Churn Save Low High Customer Maturity Index

20 CMI in action at Promapp Solutions - Software to manage process maps - Manage continuous improvement - Manage risk management initiatives

21 CMI in action at Promapp Solutions End of % Churn - Interviewed select customers - Insight to value for customer - Created framework for Customer Maturity Index (CMI) - Analysed CHS vs CMI scenarios - Invested in a consulting service offering to lift CMI

22 CMI in action at Promapp Solutions Simplified Survey Ranking 1-5 Description: The motivation and justification of this project? The expected outcome and how to measure it? How to engage other teams? Is the process charter public? Not really per team continuous improvement 1 5 entire organization 2 3 reporting 4

23 CMI in action at Promapp Solutions Simplified Survey Ranking

24 Customer Health Score CMI in action at Promapp Solutions High Consult on process governance HAPPY 52% Expand business Low At risk/weak 9% Let go??? Increase product usage by tailored training Low High Customer Maturity Index

25 Customer Health Score CMI in action at Promapp Solutions High HAPPY 52% Expand business Low Low High Customer Maturity Index Processes Aiming for higher CSAT Allowing variations Forcing standardization Using shared services Addressing legal obligations Linking to risk management

26 CMI in action at Promapp Solutions End of 2016: 2.2% Churn - Simplify CMI framework (done) - Design customer survey (done) - Identify use cases and create playbooks (WIP) - Review segmentation of customers in light of CMI (planned) - Uplift team knowledge (WIP)

27 Your Customer Health Score may be quite useless

28 Available Resources on Customer Maturity Index Title Resource Description Link 1 Why Your Customer Health Score May Be Quite Useless 2 Why Your Customer Health Score May Be Quite Useless Part 2 (There is a solution: it s called Customer Maturity Index) 3 Why Your Customer Health Score May Be Quite Useless Part 3: Your Framework to Calculate CMI 4 WHY YOUR CUSTOMER HEALTH SCORE MAY BE QUITE USELESS: YOUR FRAMEWORK TO CALCULATE CMI 5 Customer Maturity Index Interview with Boaz Maor 6 Why Your Customer HealthScore is Useless and How to Overcome It Blog on LinkedIn Blog on LinkedIn Blog on LinkedIn Blog and free templates on OpenViewLabs Video on Successly.io Slide deck on SlideShare labs.openviewpartners.com/ customer-maturity-index/ #.WbjOZ9OGOMI single-post/2017/06/12/boaz- Maor-Customer-Success- Executive-and-Advisor

29 Your Customer Health Score may be quite useless but Customer Maturity will make it useful! Ralf Wittgen - Chief Customer Officer Promapp Solutions, Auckland Boaz S. Maor VP Customer Success OpenGov, Redwood City,

30 CS Innovation of The Year Candidate Customer Maturity Index

31 A Suggested Framework for Measuring Performance 1. Adoption Mainly Value to Customer 2. Program Expansion 3. Value to Customer 4. Relations Leading Indicators to Monetary Value Mainly Value to You 5. Non-Monetary Value to You 6. Monetary Value to You

32 What Do Other Companies Do?

33 What Do Other Companies Do? The below chart shows the most common customer health criteria according to a survey conducted by Gainsight in 2016 Product Usage 93% Adoption Executive Relationship Support Activity 73% 73% Product Usage: at what frequency and which parts of the solution are being used? Support Activity: is the customer experiencing technical challenges and getting the help required? Engagement Survey Response (NPS) Importance Power User Change Revenue Growth Recent Contact 58% 56% 54% 50% Executive Relationship: how strong is the alignment between decision-makers at both organizations? Power User Change: what is the state / position of the end user that has the deepest understanding of the product and its value? Recent Contact: when was the last time you spoke to the customer? Marketing Participation: how willing is the customer to conduct a case study or reference call? Financial Investment Revenue Growth: is the customer continuing to invest in your solution? Product Type 38% Product Type: how mission-critical is the solution to the customer s business process? Marketing Engagement 29% Billing: does the customer renew / pay on time? Satisfaction Billings 25% Survey (NPS): would the customer recommend your solution to a friend or colleague?

34 Customer Health Score A Suggested Customer Maturity Framework (Implications) Promote Maturity Expand and Leverage Medium?? (LTV, GM) CORE Promote your Solution Low Churn or Let Churn?? (LTV, GM) Save Low Medium HIGH HIGH Retain Customer Maturity Index

35 Innovator of the Year Finalist Customer Maturity Index Boaz Maor VP Customer Success OpenGov platinum sponsor